Ryan Has the Following Capital Gains and Losses for 2017

question 56

Multiple Choice

Ryan has the following capital gains and losses for 2017: $6,000 STCL, $5,000 28% gain, $2,000 25% gain, and $6,000 0%/15%/20% gain. Which of the following is correct:

• A)The net capital gain is composed of $1,000 25% gain and $6,000 0%/15%/20% gain.
• B)The net capital gain is composed of $5,000 28% gain and $2,000 0%/15%/20% gain.
• C)The net capital gain is composed of $3,000 28% gain, $2,000 25% gain, and $2,000 0%/15%/20% gain.
• D)The net capital gain is composed of $1,000 28% gain and $6,000 0%/15%/20% gain.
• E)None of the above.

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Definitions:

Consideration

Something of value that is given by both parties to a contract as the agreed-upon price or exchange for the contractual promises.

Valid Consideration

An essential element of a contract, which constitutes something of value exchanged between the contracting parties.

Forbearance

Forbearance is the action of refraining from enforcing a right, obligation, or debt in a legal agreement, usually as an act of leniency by the creditor.

Sufficient Consideration

A legal concept indicating that the value exchanged in a contract is recognized as adequate, making the contract binding and enforceable.